A value-added tax or VAT is a tax on
a. retail purchases only.
b. wholesale purchases only.
c. pollution.
d. all stages of production of a good.
d
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You have a bond that will pay you one hundred dollars one year from today. If the prevailing interest rate is r, the bond is currently worth
a. 100/r b. 100r c. 100/(1 + r) d. 100
When a brand name drug’s patent protection expires, many generic producers are usually ready to enter the market. These firms’ products are close substitutes, they have similar production technologies, the regulatory hurdles to enter are not so great, and, within a few months, there are plenty of rivals. What would you predict for the profitability during these first few months after generic drug entry?
What will be an ideal response
In a competitive market the equilibrium price and quantity occur where:
A. consumers and suppliers bargain to a mutually acceptable price. B. the downsloping demand curve intersects the upsloping supply curve. C. quantity demanded exceeds quantity supplied or vice versa. D. the upsloping demand curve intersects the downsloping supply curve.
The graph illustrates the supply of sweaters. A fall in the price of sweaters brings
A) a decrease in the quantity supplied of sweaters. B) a movement along the supply curve. C) a shift of the supply curve. D) Both answers A and B are correct. E) Both answers B and C are correct.